Aon Reports Second Quarter 2024 Results

Core Insights - Aon plc reported a total revenue increase of 18% to $3.8 billion for the second quarter of 2024, driven by organic revenue growth of 6% and contributions from the acquisition of NFP [1][5][12] - The operating margin decreased by 910 basis points to 17.4%, while the adjusted operating margin increased by 10 basis points to 27.4% [1][19] - Net income attributable to Aon shareholders decreased by 6% to $524 million, with diluted EPS down 9% to $2.46, while adjusted EPS increased by 6% to $2.93 [3][21] Financial Performance - Total revenue for the first six months of 2024 was $7.83 billion, an 11% increase compared to the same period in 2023 [29] - Operating income for the second quarter decreased by 22% to $656 million, while adjusted operating income increased by 19% to $1.03 billion [19][34] - Cash flows from operations decreased by 27% to $822 million for the first half of 2024, with free cash flow also down 27% to $721 million [8][32] Acquisition and Strategic Developments - Aon completed the acquisition of NFP for an enterprise value of $13 billion, which is expected to enhance its service offerings [2][4] - The company repurchased 0.8 million class A ordinary shares for approximately $250 million during the second quarter [2][7] - Aon announced a public-private solution to build insurance capacity in Ukraine, totaling $350 million [2] Revenue Breakdown - Commercial Risk Solutions revenue increased by 14% to $2.02 billion, with organic growth of 6% [12][31] - Health Solutions revenue grew by 48% to $662 million, driven by strong performance in core health and benefits brokerage [12][31] - Wealth Solutions saw a 32% increase in revenue to $463 million, with organic growth of 9% [12][31] Expense Analysis - Total operating expenses rose by 33% to $3.1 billion, primarily due to the inclusion of NFP's operating expenses and restructuring program charges [5][15] - Compensation and benefits expenses increased by 21% to $2.13 billion, reflecting ongoing expenses from NFP [15][19] - Amortization and impairment of intangible assets surged by 412% to $128 million, largely due to the NFP acquisition [15][34]